Link Farming

Exchanging links with thousands of irrelevant sites. Yes, it affects keyword ranking greatly, you can be on the first page of a large scale keyword within 2 months, but once google finds out about your little link farm, it will ban you forever. That why you shouldn't do it. If you exchange links with a link farm and link to them its bad for your site, and their inbound link is worthless if of course they are a confirmed link farm.

As to the definition, link farm is an ideal way to increase your site traffic. But the Search engine bots can read the source of your link if it is a link farm. So if you get caught, it will make your site suffer.

In his explaination, link farms are collections of sites that all link back to each other. So in order to gain backlinks for your main site, you create a bunch of smaller sites that all link back to it. As explained in the video, search engines can detect this and devalue those links. It's also a lot of work to set up, for marginal benefits.